According to the Iran Economist, the Program and Budget Organization announced that, taking into account the provisions of Part 1, paragraph p. Directly related to the final consumers within the framework of the designated target community (400,000 Tomans for the first three deciles and 300,000 Tomans for the next 6 deciles).
Accordingly, while eliminating rents and reducing violations in the supply and distribution cycle of basic goods, the possibility of fair redistribution of resources to the target community and compensation for increased consumer costs due to changes in the exchange rate of final consumer goods has been provided. It should be noted that it was not correct to suggest providing part of the government budget deficit from the exchange rate difference, and currently compensating subsidies to consumers exceed the capacities provided in this year’s budget law and calculations related to the increase in household expenditures due to rising prices of eligible goods. It becomes.
Regarding the requirements for the effectiveness of the preferential currency removal policy, the following can be mentioned:
– Price reform: Although the approach of reducing and limiting government intervention in the field of pricing and regulation of the commodity market is emphasized by overriding laws and documents (Article 21 of the Law on Adding Certain Articles to the Law on Regulating Part of Government Financial Regulations 2), nevertheless due to sensitivities In the context of market equilibrium and stability, especially in the context of economic sanctions, government intervention in some cases (especially basic goods) has inevitably intensified in recent years. With the implementation of the democratization plan and the fair distribution of subsidies, the level of government intervention can be significantly reduced, and only by reforming policies can the private sector be strengthened in the sustainable supply of goods.
Targeted subsidies and cash assistance to vulnerable groups: Fair redistribution of subsidies to the target community is one of the main objectives of the project, which is paid by determining the target community in the form of cash subsidies with the priority of the lower deciles. In addition, if the required conditions and infrastructure are provided, the said credits will be allocated in the form of electronic worksheets in a targeted manner for the purchase of eligible goods.
Targeted facilities to economic enterprises: Providing working capital facilities to strengthen the liquidity and financial capacity of production units and importers is one of the requirements for the implementation of the democratization plan and equitable distribution of subsidies. Working capital of livestock and poultry production units of the country should be provided by paying 20 thousand billion Tomans of facilities with a preferential rate of 10% by the operating banks introduced by the Central Bank and guaranteeing the difference between the profits of the mentioned facilities by the Program and Budget Organization.
From the beginning, the government has sought to reform the economic structure “under sanctions.” The reform of the economic structure means the transition from a state-owned and introverted economy in which prices are ordered to an economy with a market mechanism, a reduction in government spending, a lack of government ownership, and the creation of a private sector.
The government is also considering all four key elements of economic restructuring, including the government’s exit from mandatory pricing (price liberalization), inflation control, targeted subsidies, and targeted facilities, and is pursuing them seriously. For example, the government has started from the foreign exchange market in order to avoid government pricing. Based on the special powers given to the Central Bank by the Supreme Economic Coordination Council in the presence of the heads of the three powers on June 1, 1401, the bank began special programs to prevent shock currency fluctuations, which usually enter the economy from 5% of the market floor. has done.
The Central Bank intends to create a favorable foreign exchange market with the participation of applicants and suppliers and in a stable manner, despite severe sanctions, restrictions on buying and selling, and the price of foreign exchange, with special programs that began on June 12 in exchange offices. Shocking trends have not been observed in the market since these programs started.
The government has begun reforms to control inflation. For example, it has gradually reduced borrowing from the central bank and even negated the net debt of the public sector to the central bank, and the policy continues to control all the factors affecting monetary and inflation. Targeting subsidies is also considered by the government, a clear example of which is the elimination of 4,200 Tomans for basic goods and the allocation of direct subsidies to the people, and is trying to improve it during the Seventh Development Plan in the process of time.
Iran’s economy, especially after the Islamic Revolution, at the macroeconomic level relying on oil by determining the orderly price of the exchange rate as well as bank interest rates to provide cheap facilities and at the microeconomic level with low prices of energy carriers and basic consumer goods suffered from acute Dutch disease. Is. At times when the issue of structural reform has been raised, citing the term “current sensitive situation”, it has retreated from scientific reforms in the economy, especially in the complex issue of “grammatical pricing”. Distance and stability of macro variables is chronically disturbed.
Therefore, today’s government carries an inheritance of long-term structures incompatible with the real conditions of the economy, and in order to reform each of those structures, slogans, compliments, and expediencies that only postpone problems to the future are abandoned forever. To rule. Therefore, the government intends to pave the way for the structural reforms of the economy, with the help of all the forces of the system in the Seventh Development Plan, focusing on all the basic components of economic structure reform, and with the help of experts.